An ETF For Tech's New Frontiers From Innovator Capital Management, Loup Ventures

The technology sector is constantly evolving, and some exchange traded funds are specifically designed to keep pace with the forward march. 

The new Innovator Loup Frontier Tech ETF LOUP, which debuted Wednesday, is a prime example of an ETF geared to benefit from various next-generation technology themes.

What Happened

LOUP was launched in partnership by Innovator Capital Management and Loup Ventures. Chicago-based Innovator Capital Management was founded by Bruce Bond and John Southard. Bond is widely viewed as one of the founding fathers of the ETF industry, having started PowerShares in 2003. PowerShares ETFs now trade under the Invesco brand, and the issuer is the fourth-largest U.S. ETF sponsor.

Gene Munster is one of managing partners of Loup Ventures. Munster is well-known for his analysis of big-name technology and internet companies, including Apple Inc. AAPL, Amazon.com Inc. AMZN and Tesla Inc. TSLA, among others. He was previously a sell-side analyst at Piper Jaffray.

Why It's Important

LOUP follows the Loup Frontier Technology Index, which was designed by Loup Ventures.

The benchmark tracks the performance of companies that influence the future of technology through artificial intelligence, computer perception, robotics, autonomous vehicles, virtual reality, mixed and augmented reality and other avenues, according to Innovator Capital Management.

Disruptive technology investment themes such as AI, robotics and autonomous vehicles are accessible via some newer ETFs dedicated to them, but a growing number of ETFs such as LOUP offer broad-based exposure to next-generation tech investments.

LOUP debuted with 29 holdings, 70 percent of which hail from the technology sector. The consumer discretionary and industrial sectors combine for 23 percent of the new ETF's weight.

Eleven industry groups are represented in LOUP, with semiconductor and electronics makers combining for 54 percent of the fund. 

What's Next

“Disruptive technologies are forcing change, transforming business and the global economy at an unprecedented speed, and in some areas may alter the way entire industries operate,” Bond said in a statement.

LOUP is the fifth ETF in Innovator's lineup. The new ETF charges 0.7 percent per year, or $70 on a $10,000 investment.

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